CDC Halts Residential Evictions During COVID | KingSpry

CDC Halts Residential Evictions for Non-Payment of Rent Through December 31, 2020

Posted on September 3rd, 2020
by Karley Biggs Sebia

After much speculation as to what, if any, restrictions would apply to residential evictions in Pennsylvania after Governor Wolf’s eviction moratorium expired on August 31st, the Center for Disease Control (CDC) has announced an order which provides for a temporary halt to residential evictions to prevent the further spread of COVID-19.

What impact does this CDC order have on residential evictions?

The CDC’s order prevents tenants from being evicted or removed from where they are living through its effective date.  However, unlike the prior moratoriums, it only implicates evictions for “failure to pay rent or make a housing payment”.  Nothing in the CDC’s order precludes evictions due to a tenant, lessee, or resident:

  1. engaging in criminal activity while on the premises;
  2. threatening the health or safety of other residents;
  3. damaging or posing an immediate and significant risk of damage to property;
  4. violating any applicable building code, health ordinance, or similar regulation relating to health and safety; or
  5. violating any other contractual obligation, other than the timely payment of rent or similar housing-related payment (including non-payment or late payment of fees, penalties or interest).

This order also puts the onus on the tenant to invoke the protections. In order to halt a residential eviction, the tenant must provide an executed copy of a “Declaration form” to the landlord. 

What is the “Declaration form”?

To invoke the CDC’s order and halt a residential eviction, a tenant must provide an executed copy of the Declaration form to the landlord.  The CDC advises generally that all adults on the lease “should” complete the form. 

The required Declaration form is attached to the CDC’s order and it is considered sworn testimony, which means that an individual may be subject to criminal and civil penalties for any false or misleading statements or omissions.  

By the Declaration form, a tenant must make certifications such as the following:

  • That the tenant used best efforts to obtain all available government assistance for rent or housing;
  • That the tenant expects to either to not earn more than $99,000 in annual income for Calendar Year 2020 (or no more than $198,000 if filing a joint tax return), was not required to report any income in 2019 to the IRS, or received an Economic Impact Payment (stimulus check) pursuant to the CARES Act;
  • That the tenant is unable to pay full rent or make a full household payment due to a substantial loss of household income, loss of compensable hours of work or wages, lay-offs, or extraordinary out-of-pocket medical expenses (unreimbursed medical expense likely to exceed 7.5% of one’s adjusted gross income for the year);
  • That the tenant used best efforts to make timely partial payments that are as close to the full payment as the individual’s circumstances may permit, taking into account other non-discretionary expenses;
  • If evicted, the tenant is likely to become homeless, need to move into a homeless shelter, or need to move into a new residence shared by other people who live in close quarters because tenant has no other available housing options.

What is the effective date of the CDC’s order?

This order is effective upon its publication in the Federal Register on September 4, 2020 through December 31, 2020, unless extended, modified, or rescinded.

Does the CDC’s order relieve a tenant from the obligation to pay rent?

The Order expressly states that it “does not relieve any individual of any obligation to pay rent, make a housing payment, or comply with any other obligation that the individual may have under a tenancy, lease, or similar contract”.  It also does not relieve a tenant from the obligation to follow all other terms of the lease and/or applicable housing rules and a landlord may pursue eviction for those violations.

What impact does the CDC’s order have on a landlord’s right to charge late fees, penalties, and/or interest as provided by a written lease?

The Order also expressly states that a landlord may continue to charge late fees, penalties, and/or interest as a result of the failure to pay rent or other housing payment on a timely basis, that it is entitled to under the terms of a lease.  However, while these amounts may continue to accrue, in accordance with the CDC’s order they are considered housing-related payments and a landlord may be temporarily precluded from pursuing eviction for non-payment of these charges. 

What happens in January of 2021 if the CDC’s order is not extended?

Provided that the order is not extended or modified, there is nothing that limits a landlord from demanding payment in full for all payments not made prior to and during the temporary halt.  If the tenant does not make payment in full, a landlord may then pursue eviction.

Are there any penalties for non-compliance with the CDC’s order?

Yes, a landlord who violates this order may be subject to criminal penalties including a monetary fine and up to one year in jail. 

What does this CDC order mean to public housing authorities? 

We await further guidance from HUD on the relevance of this order to public housing authorities (“PHA”).    

This order is, in large part, not relevant to PHAs as a tenant’s rent is determined based upon income.  Accordingly, if a tenant notifies a PHA that the tenant has suffered a change in income due to COVID-19, the tenant’s rent will be adjusted to account for the loss.

A more likely scenario may arise in which a tenant fails to provide timely notice to a  PHA of the loss of income, so they are charged the higher rent rate and get behind on rent. The CDC’s order likely temporarily precludes a PHA from proceeding with an eviction for failure to pay rent under those circumstances.     

Conclusion

Unlike prior Pennsylvania eviction moratoriums, this order does not include restrictions on evicting “holdover” tenants, who remain in a property past the end of the lease term, or tenants who merely refuse to pay rent in the absence of any financial hardship.  Accordingly, it appears to provide some relief to landlords while considering the need for housing stability of tenants truly suffering a financial hardship due to the pandemic. 

However, in practice, it is unclear whether this order will provide any meaningful relief to landlords or whether it will serve as a continuing prohibition on all evictions for non-payment of rent.  While the certifications on the Declaration form may dissuade some individuals from declaring a financial hardship who are not otherwise experiencing such a hardship and encourage those who can pay partial rent to make payments, it is unclear whether law enforcement will take any action to pursue criminal charges against individuals who are not truthful.  Similarly, it may be difficult and time consuming for a landlord to pursue civil remedies.   

The order also allows states and local authorities to provide greater public-health protection and impose more restrictive requirements at their discretion.  This means that more restrictions on residential evictions in Pennsylvania may be forthcoming and landlords must remain vigilant to ensure that they are in compliance with the most up to date requirements.

As the status of residential evictions is routinely changing due to the COVID-19 pandemic, we recommend landlords consult with legal counsel before initiating eviction proceedings. 

 

This news item is a publication of KingSpry. It is meant to be informational and does not constitute legal advice.